The plan would require companies to commit 15 percent of the repatriated cash to infrastructure projects that the ratings agency believes would pump $189.5 billion into the $18.4 trillion U.S. economy, assuming a multiplier effect of $1.30 per each dollar invested. The number of new jobs is equivalent to about a month and a half's worth of job creation at the current pace.
"We see infrastructure as the grease that keeps the economy moving along," Beth Ann Bovino, chief economist at S&P Global Ratings and a co-author of the plan, said in an interview. "That's why we're looking at it as an investment and not a cost."
The plan would involve what likely would be a 12-month holiday to bring the cash home without penalty. Companies then would be required to use 15 percent of the cash on their balance sheets to buy government infrastructure bonds, generally considered a safe investment.
Projects would be varied, from fixing roads and bridges to improving technology, increasing broadband service and enhancing the electrical grid.
A primary reason for attaching conditions is that previous repatriation holidays did little to boost the real economy. In 2004, companies brought back some $362 billion from overseas but used it primarily to reward investors through stock repurchases, dividends, and mergers and acquisitions.
Under this plan, companies wanting to avoid the 35 percent U.S. corporate tax rate would have to comply with conditions or face full taxation.
Bovino is unsure what chance this type of plan has of getting any traction in Congress. President Barack Obama in 2015 proposed a one-time break of 14 percent on overseas cash and a 19 percent tax on future earnings, but it didn't go anywhere.
In the current political climate, both Hillary Clinton and Donald Trump have talked on the presidential campaign trail about corporate tax reform and repatriation. A little political momentum wouldn't hurt the effort. Bovino said she hopes that if nothing else, the proposal helps spur a larger movement toward corporate tax reform.
"We wanted to put this proposal out because we want to get the conversation started," Bovino said. "Obviously, it's something that both parties are showing interest in and support. This is one avenue they can explore. This is really just a starting point."